MUMBAI (Commodity Online): Steel Authority of India (SAIL), Essar and Ispat, leading steel makers of India, reported a huge growth in their sales in October.

Accordign to reports, the three giants recorded around 30% growth in sales volume and JSW Steel’s sales doubled in October, 2009, compared with the same period last year.

Press notes issued by the respective companies said healthy demand for the metal indicates a sharp turnaround in the economic activity which had slowed down considerably in the second half of 2008.

Demand for steel is coming mainly from auto, rural construction and infrastructure sectors. The demand for construction grade steel, which slumped in August due to the monsoon, picked up again during October in some major steel markets. SAIL posted 28% growth in sales to 8.5 lakh tonne in October.

JSW sold more than 4 lakh tonne in October 2009, which is almost two times compared with the year-ago period.

Most steel companies had cut production in October last year due to the global economic crisis and steep fall in demand. This was accompanied by sharp drop in metal prices as imports surged. But the economy started looking up after the government came out with a stimulus package to safeguard the domestic manufacturing industry early this year.

Among others, primary steel maker Ispat Industries also posted double digit sales growth last month. While domestic steel demand continues to remain firm, prices have come under pressure with the fall in prices in the international market.

Meanwhile, Tata Steel cut prices of its products by about Rs 1,500 a tonne in tune with falling global rates. With the reduction, Tata Steel joins leading steel makers SAIL, JSW Steel, Essar, Ispat Industries, all of them on Tuesday cut prices of flat steel products by up to Rs 1,500.

JSW Steel said its production rose by 34 per cent to 4.53 lakh tonnes in October on account of robust demand.

The company’s crude steel production in October 2008 was 3.38 lakh tonnes, the steel maker said in a statement.

Production of flat-rolled items, mainly used by auto and consumer durable industry, rose by 19 per cent to 2.96 lakh tonnes in October. JSW Steel produced 2.48 lakh tonnes of flat products in the same month last year.

Production of long-rolled steel products, primarily used by the construction sector, surged 145 per cent to 75,000 tonnes in the reporting month against the output of 30,000 tonnes a year ago.

Meanwhile, minister of state for steel Prathap Annayyagari said India needs to double its steel production from the current 55 mn tonnes in five years if it wants to bridge the demand-supply gap.

During the last five years, the growth in the demand for steel has averaged to around 10 per cent. To meet this growing demand, the steel sector has to double its production in the next five years.

The country has to further increase the steel output to 200 million tonnes by 2020, he added.

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